Sugar Land, TX

Be warned Farmers home insurance policyholders, you may see your rates climb an average 9.9% in February 2009.

The new rates don't account for losses related to Ike, rather Farmers needed the hike to cover rising labor and materials costs. Farmers has not calculated the hurricane damage costs into thier rates, which means there could be another planned increase on the horizon ready to hit your pocketbook like a hurricane.

The company, which sells home insurance through its Texas companies Farmers Insurance Exchange, Fire Insurance Exchange and Texas Farmers Insurance Co., notified state regulators of the bump in rates earlier this week.

Farmers has 760,000 home policyholders in Texas. But only half - those under its "HOA" policies - will see a rate increase, Levy said. Customers with Texas Farmers Insurance Co., which sells the "Texas Family Home Policy," will not be affected by this increase. Those customers saw their rates jump an average 7.9% in May. In a move to compete in the condominium market, Farmers will cut rates an average 10% for condo policies, Levy said.

Farmers is the second company to raise rates in Texas following Hurricane Ike.

USAA told state regulators last month that it will raise Texas home insurance rates an average of 7.9% because of growing construction costs and the increase in the frequency of catastrophic weather. In Harris County, the average increase was 20.9 %.

We should also expect the other major insurance carriers to follow with rate increases as well.

General Growth Properties which owns 5 shopping malls in the Houston area: Baybrook Mall, Deerbrook Mall, First Colony Mall, The Woodlands Mall and Willowbrook Mall reported in a regulatory filing Tuesday that it faces potential bankruptcy if it's unable to refinance its debt. In addition to its Houston malls and other holdings, General Growth has dozens of other malls and high-end properties throughout the U.S.

The publicly traded company also owns a 50% interest in The Woodlands and was a developer of Bridgeland which are both master-planned communities. The company reported it has about $958 million in debt that is due Dec. 1, with another $3 billion due in 2009. GGP warned in its filing with the U.S. Securities and Exchange Commission that efforts to refinance or extend that credit might not succeed.

The company pointed to factors such as a weak credit and retail environment, making it hard for the firm to get financing. The company also has had its debt downgraded, reported large quarterly losses and suspended its quarterly shareholder dividend in recent weeks.

I attended an informative mortgage update seminar today provided by Dixie Sanders of Patriot Bank. Here are some great tips and information she provided to us.

Here are the 9 worst credit mistakes that will affect your FICO score in order of severity:

1) Bankruptcy: will appear on your credit report for at least 7 years, and possibly up to 10 years.

2) Judgments: from court cases, settlements, or liens are the second deadliest sins to your credit.

3) Tax Liens: unpaid tax liens will appear on your credit report.

4) Foreclosures: expect it to be difficcult to get another mortgage if you have a foreclosure on record.

5) Automobile Repossessions: car payments are less than mortgage payments. If a car was repossessed, it does not look very good to lenders.

6) Charge Offs: the collectors gave up and wrote off the debt, but your credit rating is still on the hook.

7) Collections: these often continue as collection companies often sell off the colllection rights to another company. Each one will report thier case each time on your credit report, seems to never end.

8) Late Payments: expect to lose 20 points per incident.

9) Inquiries: there are two types hard and soft pulls. Soft pulls do not affect your score.

For the most accurate FICO score visit www.myfico.com which is the most accurate for mortgage scores. Here is a chart that defines the main components that contribute to your FICO score.

According to a report by the Urban Land Institute and PricewaterhouseCoopers Houston is one of the nation's Top 10 real estate markets for the first time in more than 10 years due to its ties to the strong energy industry.

Houston is ranked 6th in the nation for real estate investment prospects - was declared a "hot-growth market," according to the Emerging Trends in Real Estate 2009. Market strengths include the Johnson Space Center, the Texas Medical Center, the Port of Houston and trade with Mexico, the report says.

"The population keeps expanding due to the high-octane job engine and reasonable cost of living (land is cheap and so is housing)," the report says. "Home prices never escalated dramatically, so values hold better in the mortgage crunch.

Remarkably for this construction-crazed market, office vacancies drop close to 10 percent - surveys signal a good buy opportunity, but apartments soften - still too much new construction. According to the report, moderate-income apartments in core urban markets near mass transit offer the best investment opportunities, a consistent trend from the previous year. Distribution/warehouse facilities were the next best investment, according to the experts.

Downtown office space is expected to outperform suburban markets, according to the report, and retail development is generally near the bottom but still has farther to fall. The housing industry faces more foreclosures and no rebound in values for 2009, according to the report.

Savvy investors will be able to cash in on the inevitable recovery, according to experts.

"Money will be made on riding markets back to recovery and releasing properties, not on financing structures," according to the report.

A Department of Commerce report reveals that new home sales rose 2.7 percent nationally in September as median home prices dropped to the lowest level in four years.

Sales of new single-family homes for September 2008 were 464,000, according to the U.S. Census Bureau and Department of Housing and Urban Development figures. For August there were 452,000 homes sold nationally.

Data show homes sales in the United States have been up and down since June, with August sales the lowest of the year. New homes sold in September 2007 were reported at 694,000 which is a 33.1% more than September 2008 sales.

The national median price of a new home sold in September was $218,400, down about 12% from last year, and is the lowest price since 2004 when the median price jumped to $221,000 from $195,000 in 2003.

The average price of a single-family home rose by 4.4% in September to $211,660, the highest level ever for a September in Houston. The median price of a single-family home rose 5% last month to $157,500, also an all-time September high. The median price represents the figure at which half of the homes sold for more and half sold for less. This number is also raised by the recent booming luxury real estate market in Houston averaging into the statistics.